Crypto firm FTX gets warning from FDIC to stop misleading consumers about deposit protection
Summary
Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, speaks during an interview on an episode of Bloomberg Wealth with David Rubenstein in New York, US, on Wednesday, Aug 17, 2022. "Based upon evidence collected by the FDIC, each of these companies made false representations —including on their websites and social media accounts — stating or suggesting that certain crypto-related products are FDIC-insured or that stocks held in brokerage accounts are FDIC-insured," the regulator said in a press release. The agency said knowingly misrepresenting or implying that an uninsured product is FDIC-insured is prohibited by the Federal Deposit Insurance Act. In the letter specifically to FTX, the FDIC said it appeared that on July 20, Brett Harrison, the president of FTX.US, published a tweet stating that direct deposits from employers are stored in FDIC-insured accounts in the users name. FTX.US is a U.S. cryptocurrency exchange owned by FTX, which is based in the Bahamas and has been largely focused on building its business outside of the U.S.